TSA Withdraws Cost-Saving Amendment That Had Been Filed with FMC
The Federal Maritime Commission has issued a press release announcing that on February 10, 2009 the Transpacific Stabilization Agreement decided to withdraw Amendment No. 011223-043, which would have provided authority for TSA members to discuss cost savings and more efficient use of vessel and equipment assets and networks.
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The TSA, a 14-member carrier agreement with substantial market share in the Asia and U.S. trades, had contemplated developing a coordinated capacity rationalization program under the amendment, in addition to its existing rate discussion authority.
In late January 2009 the FMC had requested that TSA and its member lines provide additional information, pursuant to 46 USC 40304(d), that would assist the agency in reviewing the Amendment under section 6(g) of the Shipping Act. This request for information had delayed the amendment's effect until 45 days after this information was submitted.
Even With Overcapacity Challenges, FMC Says Amendment Needed Evaluation
While acknowledging overcapacity challenges arising from a global decline in liner cargo volumes, the release states that the FMC has a statutory responsibility to evaluate the potential economic and anticompetitive impacts of all proposed agreements.
Many Organizations Had Commented on Amendment
The release also states that many organizations and companies had filed comments, either in opposition to or in support of the TSA's Amendment.
For example, the National Customs Brokers & Forwarders Association of America, Inc. had submitted comments opposing this TSA amendment. According to NCBFAA, the amendment sought immunity from antitrust laws to collectively discuss capacity and rationalization issues, and could result in an unreasonable reduction in transportation service or an unreasonable increase in transportation costs.
(See ITT's Online Archives or 12/31/08 news, 08123199 1, for BP summary of initial FMC's notice on the filing of the amendment. See ITT's Online Archives or 01/13/09 news, 09011320, for BP summary of FMC's announcement of January 14, 2009 meeting. See ITT's Online Archives or 01/20/09 news, 09012035, for BP summary of results of January 14, 2009 meeting. See ITT's Online Archives or 01/27/09 news, 09012730, for BP summary of FMC announcement of January 28, 2009 meeting. See ITT's Online Archives or 02/02/09 news, 09020220, for BP summary of FMC request for additional information on the amendment.)
FMC press contact: Karen Gregory (202) 523-5725
FMC release (NR 09-03, dated 02/11/09) available at http://www.fmc.gov/speeches/newsrelease.asp?SPEECH_ID=270